With new host Stephen Colbert at the helm, “The Late Show” will stay in New York City and continue broadcasting from the Ed Sullivan Theatre, CBS announced on Wednesday.

The decision to keep the show on the East Coast — following the departure of “Late Show” host David Letterman — comes with tax incentives for the network.

CBS will be eligible to receive at least $11 million in tax credits over five years, and the state economic development agency, Empire State Development, will make available up to $5 million in grants for renovations at the Ed Sullivan Theatre, New York Gov. Andrew Cuomo’s office said in a press release.

The agreement between the state and CBS includes a commitment by the network for about 200 jobs, according to the release.

After Mr. Letterman announced he is stepping down, some New Yorkers grew concerned that the show would leave the city, where it has become a fixture in Midtown. Mr. Cuomo said in February he would urge CBS president Les Moonves to keep the show in New York.

“I look forward to watching ‘The Late Show’ from the historic Ed Sullivan Theatre for years to come,” Mr. Cuomo said on Wednesday.

Senate Co-Leader Jeff Klein, a Bronx Democrat, said in a statement that he’s a big fan: “His show represents the savvy, smarts and good humor of our great city and I’m delighted we were able to keep him and his fantastic team right here where they belong.”